James Brokenshire: I beg to move,
	That leave be given to bring in a Bill to make provision about the content of driving tests; to create offences relating to dangerous driving; and for connected purposes.
	In introducing this Bill, I wish to make specific acknowledgement of the work of the children and young people's think tank "Kids Count", and of the "Drive to Survive" campaign. I also want to recognise the work of Inspector Toby Day of Leicestershire police and of the all-part parliamentary group on child and youth crime. I want to thank all of them for their assistance on the matters that I am bringing before the House this afternoon.
	In 2006, the last year for which figures are available, 3,200 drivers, passengers and pedestrians lost their lives as a result of road accidents, but no figures, numbers and statistics can convey the underlying tragedy of each case—the loss of friends, family members and loved ones whose lives have been cut short, and the lifelong impact on those left behind. The headline figures mask some disturbing trends and patterns of behaviour. Although the total number of fatalities has decreased over the past five years, the number of fatalities among young drivers under 25 has gone up from 537 to 606—an increase of 13 per cent. The number of young drivers under the age of 25 convicted of driving while intoxicated due to drink or drugs also increased in that period.
	There is also the serious issue of deaths arising from high-speed chases. In 2006-07, some 155 people were killed or seriously injured as a result of road traffic collisions on public roads during emergency responses and police pursuits. Some of the recent headlines say it all. A police officer was injured after his patrol car collided with a stolen caravan during a chase on the M6, a woman was killed and four people taken to hospital when a car collided with a Mercedes that was fleeing police in east London, and friends of a teenager who died in a car that crashed after it was involved in a police pursuit have been paying tribute to him ahead of his funeral. At the end of last year the Independent Police Complaints Commission published its two-year review of road traffic incidents involving police vehicles that resulted in a fatality or serious injury. It made 29 recommendations about how police practice could and should be changed.
	More should be done to reduce the number of deaths and injuries arising from accidents involving young drivers and pursuits. That will partly involve prevention through demonstrating, and bringing home very clearly, the reality of being involved in a serious car accident. I was moved by a recent presentation organised by Drive Survive, a multi-agency partnership based in Cheshire. Partners involved in the project and the presentations that Drive Survive offer include the police, the fire brigade, the Highways Agency, the ambulance service and hospital accident and emergency services. By dramatically highlighting the consequences of inappropriate driving and vehicle control, Drive Survive seeks to educate young people aged between 16 and 25 of the risks involved in driving dangerously or recklessly, and to prevent serious injury or worse.
	Having sat through part of the presentation, I can confirm that the content is deliberately graphic and hard-hitting. It shows real-life images of accident scenes and direct testimony from those who do an amazing job in responding to emergency call-outs. Most importantly, it includes personal accounts from families affected by the loss of a relative in a car crash. The project has received very positive feedback from local colleges and other stakeholders, who testify to the impact that it has had. I believe that such education, understanding and recognition of the consequences of dangerous driving could have a wider impact and could start to change attitudes, altering the approach of young, normally male, drivers who think that it is impressive or the right thing to do to try to show off to their mates about the limits of what their cars can do, or indeed of what they can do behind the wheel of a car.
	My Bill would amend the Road Traffic Act 1988 by including a specific reference in the driving test to the impact of being involved in an accident involving a motor vehicle, and in relation to the powers of the Secretary of State and local authorities to provide road safety information and training. I believe that that small change to the law would assist, encourage and facilitate a national programme to temper the behaviour of young drivers through hard-hitting education and training programmes focused on the reality of driving dangerously. By providing such a real-life context as part of the theory exam in the current driving test, it will make the test more relevant and emphasise other existing safety aspects of the theory requirements.
	This approach is intended to build on the current Arrive Alive road safety programme conducted by the Driving Standards Agency, and to extend the concepts of what happens when an accident occurs—the types of injuries sustained, the likelihood of survival, and so on—so that they form an important part of the preparation for learning to drive.
	The second part of my proposals addresses the legal sanctions available in circumstances where there is a pursuit. To date the focus has been on dealing with the effects of pursuits, instead of the cause. Pursuits are inherently dangerous and are difficult to manage and contain operationally. If drivers did not make off from the police, there would be no reason to pursue them.
	The instant that drivers decide to accelerate away from police vehicles to avoid capture, for whatever reason, they make the decision to enter an extremely high-risk arena where a number of lives, including their own, are put at risk. Many of them have driven vehicles at horrendous speeds along public roads for up to an hour before they are stopped, and prepared to take any steps to evade arrest, yet even when they are caught, most walk away with little or no punishment.
	A number of pursuits occur when offenders choose to make an escape having committed relatively minor offences. Research has shown that the main reason why offenders flee in a vehicle is that they are not deterred by the low level of punishment that they perceive will result from their actions. Some reports indicate that the prospect of a custodial sentence would cause offenders to abandon their vehicle at an early stage and make off on foot. Although current sentencing guidelines for the offence of dangerous driving allow for evading arrest to be taken into account, this approach is not acting as a deterrent, and in my judgment is not working well in practice.
	My Bill would therefore create a new offence aimed at someone refusing to stop when requested by a police officer and then engaging in sustained and extreme dangerous driving. It would achieve this by creating an aggravated driving offence punishable by an unlimited fine, mandatory disqualification and up to three years' imprisonment. A key part of the new offence is that it would require intent; in other words, where someone is asked to stop, knowingly fails to do so and then drives dangerously, an offence would be committed.
	This approach has the support of the Association of Chief Police Officers and the Police Federation. Too many lives continue to be lost on our roads. We need to cut the annual death toll. The measures that I have outlined are practical, proportionate and deliverable. They can play an important part in changing the mindset behind the wheel, and in so doing, reduce the number of individual tragedies that so many of us see in our constituency surgeries each week. I commend them to the House.
	 Question put and agreed to.
	Bill ordered to be brought in by James Brokenshire, Mike Penning, Mr. John Leech, Mr. Stewart Jackson, Mr. Lee Scott and David T.C. Davies.

'(1) This Part has effect in relation to employment by or under the Crown as it has effect in relation to other employment.
	(2) For the purposes of the application of the provisions of this Part in accordance with subsection (1)—
	(a) references to a worker are to be construed as references to a person employed by or under the Crown;
	(b) references to a worker's contract are to be construed as references to the terms of employment of a person employed by or under the Crown.
	(3) This section does not impose criminal liability on the Crown.
	(4) But on the application of the Pensions Regulator the High Court or the Court of Session may declare unlawful a failure by the Crown to comply with any of the duties mentioned in section 40(1).'.— [Mr. O'Brien.]
	 Brought up, and read the First time.

Mike O'Brien: Obviously, how much someone gets depends on the length of time for which they contribute and the pot that they build up, so there is not a straight answer to that question. I will ask my officials to consider the balance, because many soldiers will serve for less time than many employees will have to build up a pension pot in regular, non-military employment. I will examine the figures carefully and write to the hon. Gentleman, who has asked a reasonable question.
	Reservists may accrue benefit under the reserve forces pension scheme, if they enter full-time reserve service. That is also one of the options available to mobilised reservists. Another option is remaining with their existing pension scheme—their employer scheme—in which case the Ministry of Defence would pay the employer contribution. Separately, cadet force adult volunteers offer their time without receiving a wage or pension contributions. Although they may receive occasional remuneration for training, this clause makes it clear there will be no access to pension saving.
	Finally, new clause 19 brings members of the constabulary and police cadet forces of Great Britain within the scope of the reforms. It is necessary, because some police officers are "office holders" and do not therefore routinely fall within the definition of "employee" or "worker". Accordingly, those members who are not employed under an employment or worker's contract are included by being treated as workers. We include constables and trainees appointed by the chief officer of police as "police cadets". Police officers in a Home Office or Scottish force become members of the police pension scheme. The great majority are members of the 1987 scheme, but since April 2006 entrants have become members of the new police pension scheme 2006. Both schemes are defined benefit pension schemes.
	The officers' contribution rate for each scheme is relatively high. Although we think that it provides good value for money, it can and does cause a very small number of officers to opt out, particularly during early years of service when earnings are lower. The new clause will ensure that any officer who opts out of the police pension scheme will receive the same protection as others in employment—that the employer retains the duty to seek to re-enrol non-participating officers at key intervals during their work with the police, to nudge job holders into reconsidering an earlier decision; I was about to say "employment" with the police, but of course the very point is that it is not employment.

Nigel Waterson: I begin by echoing the Minister's opening remarks. I thank all members of the Committee—some of whom have retained their enthusiasm for the Bill, while others clearly have not—the officials, Clerks and everyone else involved. I pay particular tribute to my hon. Friend the Member for South-West Bedfordshire (Andrew Selous), who sadly cannot be with us today because of ill health. He made a signal contribution in Committee, and as a former officer in the Territorial Army, he did so in particular on the provisions concerning the armed forces and reservists.
	New clause 17 seems fairly clear to me; I suppose it might be called the "Backstairs Billy" new clause, dealing with those employed directly by the Queen or members of the royal family. Sadly, Backstairs Billy is no longer with us, so he will not be able to benefit from the provision. It is right that the Crown's direct employees are swept into this provision. My right hon. Friend the Member for Wokingham (Mr. Redwood) made a point about enforcement a moment ago; as I understand it, the best that the Pensions Regulator can do is apply to the courts for a declaration that the Crown has failed to comply with any of the duties set out in clause 40(1), which concerns the enrolling of employees into the system of personal accounts. There is no criminal liability at all. I believe that the matter is based on legislation concerning the working time directive. I guess that we will just have to rely on the sovereign doing the decent thing when such a declaration is made.
	The important issue of reservists was raised in Committee by my hon. Friend the Member for South-West Bedfordshire, who felt quite strongly that the distinction between regulars and Territorials has been eroded in recent years. Many Territorials spend a great deal of time on active service in Iraq, Afghanistan or wherever, and therefore they should not be treated any differently from regular members of the armed forces. It was helpful to hear both what the Minister said and what he set out in the letter he wrote to the Committee in February, in which he made clear that reservists can accrue their own benefits under the reserve forces pension scheme.
	The Territorial Army, in particular, is a component part of the reserve forces and there is pension provision for reservists who are mobilised or who enter into commitments that require regular attendance under the Reserve Forces Act 1996. However, I remain keen to hear from the Minister about the level of contribution, as well as about the level of likely pension benefit for regular members of the armed forces who have what I assume is, in all essentials, a non-contributory defined benefit scheme. It is important to see not only what the likely benefits will be over a given period, but what contribution the taxpayer will make.
	I am sure that the Minister would agree that, broadly speaking, the benefits obtainable under that scheme should be at least as good as those that would be available under personal accounts, albeit without the contribution from the employee, in this case a member of the armed forces. I suspect that if there is any inadequacy in that comparison our colleagues in the Lords will wish to come back to the issue at some stage. Broadly speaking, however, we have no difficulty at all with the new clauses or the amendments in the group and would be happy to see them in the Bill.

Mike O'Brien: I am getting nods from those who have served in the armed forces and are better informed. However, I will write to the hon. Member for Eastbourne on levels of contribution.
	The hon. Member for Hemel Hempstead (Mike Penning) made his point well and I have sympathy for him. That point came up during our evidence sessions in Committee and we heard various views on it. The concern among some stakeholders is that there will be a transfer into personal accounts of a significant number of pension schemes, which some of those running such schemes are concerned might lead to what is called a levelling down of the quality of provision. To avoid that, we have said that that should not happen at the start. That provision will run on, and we will look into it when we hold the review.
	The process will start in 2012 and the review will happen not long afterwards. In any event, there will be a three-year running-in phase. Reaching the compromise involves precisely the problem that the hon. Gentleman has identified; I do not dispute anything that he has said. Some people will end up with very small pension pots not being transferred in, although it would be better to do so. However, this is part of getting broad consensus and support and, although it is not what we might otherwise have wanted, it is a price worth paying to get everyone to sign up to agreeing that this is the right way to proceed. I understand the hon. Gentleman's point. Indeed, it was discussed in Committee. Having said that I have sympathise with him even though I cannot deliver exactly what he wants, I hope that he will none the less offer his support to the new clause.
	 Question put and agreed to.
	 Clause read a Second time, and added to the Bill.

'(1) This Part has effect in relation to a person who—
	(a) holds the office of constable or an appointment as a police cadet, and
	(b) does not hold that office or appointment under a contract of employment, as if the person were employed by the relevant police authority under a worker's contract.
	(2) A police authority that maintains a police force is the relevant police authority—
	(a) in relation to a constable, if the constable is a member of that police force;
	(b) in relation to a police cadet, if the cadet is undergoing training with a view to becoming a member of that police force.'. .—[Mr. Mike O'Brien.]
	 Brought up, read the First and Second time, and added to the Bill.

Mr. Speaker: With this it will be convenient to discuss the following:
	New clause 3— Costs incurred by Pensions Regulator
	'The set-up costs incurred by the Pensions Regulator in carrying out its duties under Chapter 1 of this Act shall be funded from the Consolidated Fund.'.
	New clause 4— Costs incurred by Personal Accounts Delivery Authority
	'The set-up costs incurred by the Personal Accounts Delivery Authority in carrying out its duties under section 58 of this Act shall be recouped through charges to members over a period of five years from 1st April 2012.'.
	New clause 5— Financial assistance to Personal Accounts Delivery Authority
	'Any financial assistance given to the Personal Accounts Delivery Authority by the Secretary of State must include conditions about repayment and interest at commercial rates.'.
	Amendment No. 15, in clause 66, page 33, line 7, leave out paragraph (b).
	Amendment No. 16, in page 33, line 9, leave out subsection (4).
	Amendment No. 9, in clause 69, page 34, line 11, at end insert—
	'(3A) The Authority must within 12 months of the passing of this Act, and at such other time as the Secretary of State directs, publish a report analysing the potential impact on the financial position of a scheme under section 50(1) of different rates of—
	(a) take-up of,
	(b) persistency in, and
	(c) contributions to
	the scheme, and setting out appropriate options for managing the financial risks associated with different outcomes.
	(3B) In preparing the report under subsection (3A) the Authority must have regard to such independent actuarial advice as it considers appropriate.'.
	Amendment No. 13, in clause 70, page 34, line 31, at end insert—
	'and initially based on an annual management charge of no more than 0.3 per cent. per annum.'.
	Amendment No. 27, in clause 72, page 35, line 13, leave out 'grants'.
	Amendment No. 28, in page 35, line 15, leave out from '(which' to end of line 16 and insert—
	'shall include conditions about repayment and interest at commercial rates.'.
	Amendment No. 14, in page 35, line 16, at end insert—
	'(3) For the avoidance of doubt, all the costs incurred by the Authority in establishing the pension scheme under section 58 of the Pensions Act 2008 (c. ) shall be recouped through charges to members over a period of five years from 2012.'.
	Amendment No. 10, in schedule 1, page 62, line 11, leave out 'grants'.
	Amendment No. 11, in page 62, line 12, leave out from 'which' to end of line 13 and insert—
	'shall include conditions about repayment and interest at commercial rates.'.
	Amendment No. 12, in page 62, line 14, leave out from 'may' and insert 'is required to make'.

Mike O'Brien: Some of the issues under discussion are complex and important, so I am afraid that it will take me some time to go through them.
	On the start date, our intention has always been that the reports should be introduced in 2012. That has not changed, but, quite naturally, Tim Jones wanted to assure himself that the plans that he inherited as chief executive were deliverable. He has now completed his review. I am afraid that it was not the sort of hefty report that the hon. Member for Eastbourne (Mr. Waterson) may expect, but Tim Jones met me and produced his report bang on time. He now has a credible set of plans that are consistent with starting to deliver the scheme from 2012.
	If the Liberal Democrat spokesmen—both the hon. Member for Rochdale (Paul Rowen) and the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander)—want to meet Tim Jones, he would be delighted to do so. The hon. Member for Eastbourne is probably aware that the hon. Member for Wantage (Mr. Vaizey) has already met Tim Jones to discuss some of the cost issues and some other issues, including those of commercial confidentiality as contracts of a substantial value will be offered to set up the scheme. It is therefore important that the scheme's commercial confidentiality, and therefore its viability, is maintained. For that reason, with due undertakings from the hon. Members concerned, I am sure that Tim Jones will be able to discuss some of the issues in detail, provided that that detail does not cross into the public arena, where it might prejudice the various contracts.
	We are still four years away from the go-live date for a complex programme that delivers ground-breaking reforms. It would be ludicrous to stand here and say that there are not uncertainties, risks or events around the corner that might change how we see things. We must not lose sight of the fact that it is not just Tim Jones, the Pensions Regulator and the Government who need to deliver to make some of the reforms a success. For instance, the date for Royal Assent for the Bill is, to use a Donald Rumsfeldism, an example of a "known unknown". We do not know when the Bill might be delivered. We have made good time in scrutinising it in Committee, but I cannot be sure, even with the best will of the House, of the exact date of Royal Assent. That means that I cannot be sure of the exact date that PADA will get the legal authority that it needs to begin to implement the personal accounts scheme. I anticipate that that will not have much impact on the delivery of the IT or the systems supporting the personal accounts scheme, but we will need to understand the impact on a range of supporting activity, including when we can deliver the information needed by employers and pension schemes so that they have time to prepare.
	There are other unavoidable uncertainties, to use a different phrase. The pension accounts scheme will be unlike any other scheme in that it will be the largest occupational scheme in the UK, with 4 million to 7 million active members, and it will interact with nearly 1 million employers. It will be specifically targeted at a part of the market that, by and large, existing providers find uneconomic to serve. No other scheme has restrictions like a contributions cap, and it will be required to admit anyone eligible to join, irrespective of whether the revenue that they might bring in will cover the cost of their account. So although some of the infrastructure needed will already exist in the market, some of it will need to be developed.
	We have made assumptions about how long the procurement and build processes will take, and they are good and robust assumptions, but we will not know exactly what is involved until PADA has engaged with potential private sector suppliers and found out what they can do and how they will deliver what we need.
	We must also build into our plans the needs of employers, the pensions industry and individuals to ensure that they understand the reforms and can take the necessary steps to be ready for go-live. We have already said that we will bring employers into the reforms in stages and phase in the rate of contributions that they are required to make. We will need to get those aspects of implementation right and ensure that the right employers have the right information at the right time to meet their new duties. We need to avoid a big bang implementation so that the pensions industry, including the personal accounts scheme, and the supporting infrastructure such as advice services for employers and individuals can take on their new roles and responsibilities in a measured and controlled way.
	It would be wrong for me to predict exactly what will happen on an exact date in 2012, but I am confident that that is a realistic start date for the reforms, providing that we get the staging and implementation right. That has been the basis of my conversations with Tim Jones, and I am happy for the hon. Member for Eastbourne to have conversations with him about his plans and the outcome of his review. As I understand it, much of that review is on charts and so on, so there is paperwork. If the hon. Gentleman wishes, he can look at the charts, which show the timing involved and various other things—I had a glance at them, but I rely more on the discussions with Tim Jones than on all those charts, which he drew up for his own purposes.

Mark Durkan: My hon. and learned Friend is right to say that it would be wrong to introduce the changes in a big bang on one day, as that would be like asking for a terminal 5 debut for something that is very important to a lot of people. However, some of us are worried that all the other costs being talked about might prevent him from delivering on his promise to consider certain other matters, such as the small number of schemes that are known to fall between the pension protection fund and the financial assistance scheme. Will he assure me that the costs that we have been discussing will not have implications for any decisions made about those few schemes?

Mike O'Brien: The hon. Gentleman is right that there are time scales, and it looks as though they can delivered on, all other things being equal, by 2012. There are also estimates about various contracts. Again, for the reasons that he gave, I do not want to go into that.
	The hon. Member for Eastbourne is wrong when it comes to the figure of £500 million, which came from the Pensions Commission years ago. That was just an estimate that it made. We have not, at this stage, put forward another, separate figure, but the figure cited is not the figure that we are aware of; however, I cannot go any further than that at this stage, as regards broad figures.

Nigel Waterson: My hon. Friend is absolutely right. For the time being at least, the Government are committed to increasing pension credit in line with earnings, but a whole series of assumptions will, of course, have to be made and spelled out in the making when the calculations are done. One has to make assumptions some way out into the future about a range of things—not least the level of means-tested benefits available under successive Governments of the same or different political colours. That is an important issue, but dealing with it is a bit like trying to put up a tent in a high wind: unless we nail down one corner, we will not make a lot of progress, so a shared set of assumptions will have to be agreed so we can move forward. There will still be the known unknowns, but that is the way it is always going to be.
	To make one final point, on the basis of all the research done so far, I am utterly convinced that the starting point has to be the at-risk groups identified and then refined by the PPI, and then identification, within parameters, the numbers of people likely to fall into each of those categories, why they are likely to do so and what can be done to help them. Failing all that, we will have to see what can be done within the system of generic advice to ensure that people opt out if it is in their best interests to do so. There are some massive questions here, which makes this one of the two biggest single issues underlying this entire legislation. We are certainly keen to play our part in finding a solution if there is one.

Anne Main: They have risen by 147 per cent. in St Albans.

Mike O'Brien: I welcome the way in which the Front-Bench spokesmen for the Opposition parties, and, indeed, all hon. Members, have sought to deal with this issue. Some months ago, it was a matter of some controversy, but I think that we have found a way of at least examining what the hon. Member for Eastbourne (Mr. Waterson) rightly said is an enormously complex and difficult issue. Whether we are able to find ways of resolving it is another matter, but we envisage that the process we have set up will enable an examination of the issues. As he mentioned, we also envisage publishing later this year a report that examines the parameters of the debate and establishes ground rules and understandings about the nature and extent of the problem, the policy ways in which it might be examined and the implications of some of those, without coming to a recommendation. That would be a matter for debate between the parties and between various stakeholders afterwards.
	The debate was interesting not least for the various descriptions given. I believe that tents in high winds and seat belts were mentioned. I was reminded of the fact that, in evidence to the Committee, Lord Turner gave a further analogy, which is relevant to the discussion. He said that
	"you cannot treat the fact that some people post facto will not have done well out of saving as proof that it is a bad idea to advise them to save. An analogy would be that if at the end of the year your house has not been burgled, it does not mean that it was bad advice to buy a household insurance". ——[Official Report, Pensions Public Bill Committee, 17 January 2008; c. 98.]
	We are examining a difficult issue. It is clear that we all have constituents who are on pension credit, yet they have a second pension. How we are able to predict which people are likely to end up in that position, whether we are able to do so and what advice such people should be given if the circumstances that they will find themselves in are not always predictable are complex matters. Personal accounts will not create such a new circumstance that we are not already, in a sense, facing it. A large number of people are automatically enrolled into a pension scheme. Tesco has its own automatic enrolment scheme—I understand it to be a reasonably good defined benefit scheme—and it is therefore allowing people to build up pension pots. There is no guarantee that those people will be able to have an uninterrupted career at Tesco and that they will never fall on pension credit.
	We have said throughout—the point was made by the Liberal Democrats earlier today—that personal accounts should not provide advantages over and above those schemes with which they will compete. Therefore, we are trying to set up a basic scheme that people can use if no better scheme is available. It will complement, rather than compete with, other schemes.
	If we were to provide, solely for personal accounts, a guarantee that whatever happened anyone holding one would not lose out, it would give personal accounts a commercial advantage over and above any existing private sector schemes. Therefore, we would undermine the very principle of complementing what we currently have. If a low-paid employee can choose whether to enter their employer's scheme—it might be a good scheme with perhaps a higher contribution from the employer than personal accounts—or a personal account, and they get a guarantee from the latter that they do not get from the other scheme, personal accounts would have a commercial advantage. We need to be careful to bear in mind the basic principles behind the creation of personal accounts and ensure that, in dealing with one problem—and I accept that it is an issue—we do not undermine any of those principles.

Mike O'Brien: I hear what the hon. Gentleman says. The issues of savings incentives, disregards and trivial commutation can all be considered. We discussed some of them in Committee, and the Government have decided to set up a Government-led work programme to consider the whole issue, evaluate the evidence and consider the interaction between pension savings and income-related benefits in a reformed system. The programme will examine the incentive effects, the balance that we need to strike between alleviating poverty and incentivising savings, and the cost constraints that we face. It is important that people accept the responsibility to provide for themselves and also that the pension credit safety net is there if needed.
	The effect of new clause 2, which I suspect the hon. Member for Eastbourne will not press, would be to delay the introduction of personal accounts if the number who may not benefit is greater than 10 per cent. That would deny many individuals the real benefits of starting to save early. The reforms represent the last piece of our pensions puzzle and it would be folly to delay introduction on that basis.
	The effect of amendment No. 38 would be to require the annual publication of our projections of the impact of means testing for members of the personal account scheme and those whose pension savings might be subject to marginal deduction rates of 40 per cent. or higher. We have already published our projections of entitlement to pension credit until 2050, and are currently finalising a fact sheet of projections of entitlement to all income-related benefits for the pensioner population. We expect to publish that shortly.
	There is no need, therefore, for such an amendment to the Bill. Publishing projections of benefit entitlement is routine and represents good practice and we intend to continue with it. Indeed, my right hon. Friend the Secretary of State, when he was in my job, advised Parliament in Committee on last year's Pension Bill that we already regularly publish that information, usually annually. I am happy to reiterate that statement in order to reassure the House. I believe that our package of reforms represents the right balance.
	Let me deal with generic advice, which has been raised both by the Liberal Democrats and by the hon. Member for Hemel Hempstead (Mike Penning). Clause 9 recognises that individuals will need access to relevant and accurate information when they are auto-enrolled, but amendment No. 37 would mean that all those who were auto-enrolled would be entitled to publicly funded independent one-to-one generic advice. I do not agree that one-to-one advice will be needed by every job holder. That is because the decision to remain enrolled will be straightforward for most people. The employer contribution means that most people will benefit and enjoy a more prosperous retirement. Good information is important and the DWP and other organisations, such as Citizens Advice, the Pensions Advisory Service and the Financial Services Authority, already provide some elements of advice.
	We will ensure that every automatically enrolled individual has access to the range of information that they need to understand the process of automatic enrolment, the pensions scheme that they will be enrolled into, their expectations for a state pension and the implications for later life. As Members will be aware, there is at present no legal requirement for individuals to receive any one-to-one advice before they are automatically enrolled on an occupation pension scheme. Giving people a new legal entitlement to one-to-one advice could give them a misleading impression that automatic enrolment is either a risky and complex process for which they must have that advice, or could lead to their making erroneous decisions. We therefore take the view that the best approach is to ensure that people know the basic information about automatic enrolment and what it means for them.
	If it is a private sector pension and the person is enrolling into personal accounts, the pension providers will have advice about the implications of their product that they will give to those who are automatically enrolled into the scheme. In many cases, such advice is given now. We will be dealing with many people on low incomes, and although I entirely accept the views of the hon. Member for Bournemouth, West (Sir John Butterfill)—who knows much more detail about our parliamentary pension scheme than I do—advice and information is already being given out by some of the schemes. I do not want to create a system whereby we have to load on a lot of advice for personal accounts in particular, because the cost will end up being paid by people who are enrolled into personal accounts. If we load up the cost, it will end up being a charge on the members of the scheme.
	We need to provide generic advice, which is already available. Otto Thoresen has already published a report in which he referred to the provision of generic advice for those who were entering personal accounts. He rightly made the point that that is not just a problem for personal accounts but that it has a broader base. We are looking at the Thoresen review's details on generic advice so that we can identify ways in which we can take forward the provision of the sort of advice that people on particularly low incomes will need.

Madam Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 29, in clause 3, page 2, line 28, leave out subsection (5) and insert—
	'( ) Subsection (2) does not apply if there are prescribed arrangements under which the jobholder is entitled to become an active member, with effect from the automatic enrolment date, of a qualifying scheme which is a personal pension scheme of a prescribed description.
	( ) An order will be made under this section to prescribe the terms under which it is applicable, and the basis on which its application may be withdrawn with respect to specific scheme providers or employers.'.
	No. 20, in clause 70, page 34, line 25, after 'in', insert 'existing'.
	No. 21, in page 34, line 25, leave out 'qualifying' and insert 'occupational and personal pension'.
	No. 17, in page 34, line 26, at end insert
	'among those on low incomes and who are not currently saving enough for retirement.'.
	No. 22, in page 34, line 26, at end insert
	', and the Authority shall at no time seek to provide financial products beyond the scope of personal accounts;'.
	No. 23, in page 34, line 29, after 'on', insert 'existing'.
	No. 24, in page 34, line 29, leave out 'qualifying' and insert 'occupational and personal'.
	No. 18, in page 34, line 38, at end insert—
	'(g) the best interests of prospective members in the period prior to 2012 are served;
	(h) the level of savings shall be increased as well as the number of existing savers, and that in general better retirement incomes are achieved.'.
	No. 19, in page 34, line 41, at end insert—
	'(4) The Secretary of State shall collect and publish appropriate data annually, and will consult with the industry, to measure the extent to which the Authority has achieved these principles in carrying out its function.
	(5) The Secretary of State shall by regulation identify the data and targets to be sued for this purpose.'.

Nigel Waterson: This is another group of amendments that is rather like one of those cars that can be bought at certain scrap yards that have the front of one car and the back of another. The amendments refer to two distinct issues, so I shall separate them immediately. New clause 6 and all but one of the amendments are concerned with levelling down, which is the other massive issue that lurks throughout the Bill. I shall come separately to amendment No. 29, which is on another matter that was important in Committee: workplace pensions and group personal pensions.
	What do we mean by levelling down? We mean a scenario whereby, with the advent of personal accounts, finance directors advise their board that participation in their own defined benefit pension scheme could double almost overnight, with the cost implications that that would carry. Companies that had not already closed their existing defined benefit schemes to new or even existing members, assuming that there were any such companies by that stage, would then take the opportunity to say, "Well, we are closing our scheme now, but there is a perfectly good new scheme called personal accounts, backed by the Government, that we would point you in the direction of."
	If I have learned anything doing this job as shadow Pensions Minister, it is that there is an active desire on the part of large tranches of the population not to know anything about pensions, or to find out what level of contribution they should be paying and what pension such a contribution would produce in later life. There is almost an unwillingness to engage in the issues. At almost every seminar to which I am kindly invited, some academic seems to get up and say that he or she has done a study and come to much the same conclusion—that the vast majority of people in this country do not really engage in the pensions issue. Almost any effort from any quarter to try to improve that situation has to be welcomed. However, when the moment comes, many employees may simply not inquire whether it would be sensible to move from a DB scheme run by their employer, in which the level of employer contribution may be much higher than is envisaged under personal accounts, and what difference it would make to their pension.
	This is not, by any stretch of the imagination, an attempt to reopen the Turner settlement, which was based on a series of compromises and took into account different views, including those of the CBI and all sorts of others. However, let us remember that an overall contribution level of 8 per cent. will not deliver a very comfortable retirement. It is a massive step forward for people who have no provision at all at the moment and should have, but there is concern that the mere arrival of personal accounts will have an effect on existing, more generous pension provision.
	The point of new clause 6 is straightforward: to say that there should be a duty on PADA to minimise the effects of the introduction of personal accounts on existing pension provision. I cannot really see why the Government should not accept a new clause along those lines with alacrity, because it has been pretty clear since the Turner report that we are all on the same wavelength and believe that we should focus on the so-called target group set out by Turner, which is predominantly people who have no existing pension provision. It will be the ultimate tragedy and irony at the same time if, after this process, we end up increasing the number of savers but not the amount of savings, and if all we do is recycle roughly the same amount of savings in the pensions system, or even worse. I shall come to that possible scenario in a moment.
	Our approach in Committee, and to some of these amendments, has been shot through with attempts of all sorts to erect a kind of Berlin wall between personal accounts and existing pension provision, whether by banning transfers in and out or by banning contributions above a certain level. It is still a matter of regret that the figure of £3,600 a year, which is firmly on the record as being the Government's position on the maximum annual contribution, is not in the Bill, but so be it. We have tried to put it in the Bill and, in true form, have failed dismally at every attempt. In other ways, too, we have tried to ensure that there will be no interference with existing provision by the new personal accounts system.
	We must turn again to our old friend the Pensions Policy Institute, which has done impressive work on levelling down. If I remember rightly, it was funded by the Nuffield Foundation. As the PPI put it:
	"Levelling-down refers to the risk that, in response to the Government's proposals, employers may decide to close existing occupational pension schemes that offer more generous pension benefits to their employees and instead enrol employees into the new personal accounts."
	It went on to say:
	"Levelling-down is an important policy issue."
	I entirely agree with that. It is one of the two most important policy issues surrounding the Bill. As the PPI said:
	"There is a lot of uncertainty about how employers will respond to the reforms".
	It modelled various effects: those of no reform, of employers continuing to offer pensions on their existing terms, of what it calls "cost control", and of the modelled employer response. Those models produced wildly different projections of what could happen. The PPI made the point that without any reforms at all
	"there could be a decrease in annual total pension contributions from around £40 billion in 2006 to around £30 billion by 2050."
	So on one level, doing nothing is not really a sensible option.
	The PPI also looked at the very optimistic scenario of pension contributions increasing by about £10 billion annually. It then considered what it called a
	"very pessimistic and extreme scenario"
	that could involve the shrinking of the market below its current level, even with personal accounts being taken into account. That is an extremely sobering scenario, but, as the PPI continued:
	"In reality, employers are likely to respond in a variety of different ways."
	It referred to work done by Deloitte and Touche in 2006 showing a possible total annual pension contributions increase of £10 billion compared with a position without the reforms. However, the worrying part is that the PPI then stated:
	"But this initial increase could wane over time as employers respond to the reforms by closing existing schemes to new members".
	To adopt the expression used by the Minister in the previous debate, I do not think that there will be some big bang, with levelling down happening between one day and the next. Much more likely is that there will be a gradual process of attrition, as people move from job to job and find that pension schemes are closed to new members.
	I cannot say what will happen, and neither can the Minister or the PPI. In its written evidence to the Committee, the institute said:
	"Overall, the jury is still out as to whether the Government's pension policy will deliver both more people saving and more saving and better retirement incomes...However, the interaction of the reforms with means-tested benefits and the risks of employers "levelling down" their pension contributions both pose real challenges to the success of the reforms."
	That expresses better than even I can the concern lying behind new clause 6 and the other amendments. No one can predict how employers will behave, so any measure that will minimise the effects of levelling down—including the duty in new clause 6 that would require the PADA itself to minimise that effect—is to be welcomed.
	A related but separate issue is covered by amendment No. 29. Much concern has been expressed about workplace pension plans and group pension plans. If a solution is not found to the problem posed by GPPs, the process of levelling down could be turbocharged. The industry consensus is that we need that solution now, not in 2012. The National Association of Pension Funds said that the EU's directives on distance marketing and unfair commercial practices may prevent auto-enrolment being applied to workplace personal pensions.
	"We believe that the UK Government should continue to seek clarification from the EU on whether automatic enrolment can apply to WPPs in the UK under the proposed reforms. However, if agreement cannot be achieved, the NAPF believes that a solution can be found that would allow auto-enrolment in to WPPs in a manageable and affordable way, by establishing WPPs under master trusts."
	The Association of British Insurers shares the concern about the present uncertainty, although its alternative solution is to institute streamlined joining for those in GPPs. Some 2.5 million people are in those pensions, making up some 40 per cent. of all employer provision, and the ABI states:
	"We are particularly keen to ensure that these schemes can be preserved within the new system as they tend to offer better arrangements to employees, and continuation will save employers from a costly and complicated review of pensions provision.
	Given the current scale of the GPP market...the potential damage to pension savings is very high."
	The association concludes:
	"Failure to secure a safe future for GPPs will prompt widespread levelling-down of pensions, something the Government is so keen to avoid. The average employer contribution to a GPP is 6 per cent. If this was reduced to the Personal Accounts 3 per cent. level, some £900 million of contributions would be lost by employees."
	That is incredibly important, as losing the more generous provision would give real impetus to the levelling-down process. The ABI goes on to say:
	"A solution must be found now—not in 2012.
	2012 is still four years away, and uncertainty in the GPP market now means that financial advisers...may hold back from recommending new schemes. The impact of this is very real, especially for middle-age savers—for a 40 year old man, such a break in saving could reduce retirement income by up to one-fifth."
	Similar concerns have been expressed by the CBI and by Norwich Union, while the Equality and Human Rights Commission said:
	"We are concerned about Clause 3(5)...We understand that the Government is not entirely satisfied that auto enrolment is currently possible into commercially based personal pensions under European directives. The Government has recognised the concern that we and others have and we urge them to continue their discussions with Europe or investigate alternative solutions such as master trusts to ensure the vital principle of auto enrolment is not breached."
	It is clear that the Government should pursue a twin-track approach on this matter. They should continue to have discussions inside the EU to see what can be done. Resolving matters such as this usually takes some time, but the Government also need a plan B in case the talks do not work out. We need a workable exemption to automatic enrolment in GPPs, so that we can get the policy aims back on track—that is, to deter levelling down of existing provision, and to encourage people to continue in the schemes and to join them in the foreseeable future.
	There is a real worry in the industry, and an uncertainty that cannot be allowed to continue. The concern is that a gap in pension provision could have a real effect on the retirement income of many people. I hope that the Minister will tell us what progress has been made with the EU, and what his fallback position is if the talks do not work out.
	The problem of levelling down is a huge one, and I commend the new clauses and amendments to the House.

Mike O'Brien: I do not know whether we will be able to debate that new clause, given the issues before us, but I assure my hon. Friend that I am very conscious of the concerns that he expresses about people who find that they have a terminal illness and are unable to make a claim on the Pension Protection Fund if their pension scheme has failed and they are under the prescribed age. I propose to suggest an amendment in due course, to be tabled in another place, in order to ensure that those who are affected in that way can get some sort of help. The aim would be that provided they could show that they meet certain conditions, they would get some significant payment to help them through the difficulties that they faced.
	We all want to achieve the aim of getting more people saving, but we need to address the issues arising from the combination of individual inertia and commercial viability, which have resulted in large numbers of moderate to low earners currently not saving enough for their retirement. The Bill provides for the establishment of what has been described as a budget airline type of pension scheme. I am not sure whether I want to follow that analogy too far— [Interruption.] The hon. Member for Hemel Hempstead (Mike Penning) suggests that all the budget airlines have been successful, but Freddie Laker might have disagreed.
	We want to provide a basic scheme that will be of sufficient quality to enable people to save for their future and provide them with a reasonable income. The key problem is what happens in relation to the current better employers' schemes—not all of them are better—where the employer may be making a bigger contribution and may find that with personal accounts, the minimum contribution will cost him less. The employee may even be making a bigger contribution to an existing scheme and may find a smaller contribution to a personal account temporarily advantageous to him and his family.
	How are we to prevent levelling down? The straight answer is that we cannot prevent it. We can reduce the likelihood that it will happen and take reasonable steps to mitigate the factors that might cause it. We have already discussed one of the ways of doing that: restricting transfers in and out of personal accounts. Someone with a current pension scheme will not be able to transfer in at the start of personal accounts in order to level down. Also, we are not looking to have people transferring out of personal accounts. Preventing people messing about and transferring in and out is a mechanism to reduce the likelihood of levelling down.
	Also, there is a maximum contribution annually that people can make—£3,600. Many people will want to make a higher contribution, but we have indicated that on 2005 figures that is the level of annual contribution that we want. We have carried out surveys of employers to ask what they are likely to do if they have the option of continuing with their current scheme or moving to personal accounts. Surveys suggest that most employers would stick with what they have. No doubt some employers will see an advantage in levelling down, and I cannot give the guarantee that the hon. Member for Weston-super-Mare (John Penrose) seeks from me, that it will not happen. However, the scheme designs that we have put in place will reduce the likelihood of its happening and hopefully mitigate the possibility of its doing so on a significant scale.
	The other way in which we have tried deal with the matter is keeping the scheme simple. The hon. Member for Weston-super-Mare said that it was important to keep these things simple, and I agree entirely. So does Paul Myners, the chairman of the Personal Accounts Delivery Authority. In his evidence to the Committee, he said:
	"Keeping it simple is critical to the successful delivery of personal accounts. Every further bell or whistle that is added to the scheme will have to be paid out of people's retirement income." ——[Official Report, Pensions Public Bill Committee, 15 January 2008; c. 8, Q33.]
	That is exactly right. It is a view that is broadly shared. It is also one of the ways in which we can reduce levelling down. People have requirements from their pension scheme. If the scheme on offer is kept simple, and if it will provide some of the bells and whistles with a higher contribution, we envisage that they are likely to stay with it.
	The hon. Member for Weston-super-Mare asked how we would measure an acceptable outcome. We want to ensure that we get considerably more people saving. The aim—we need to look at the ambitious end—is to have up to 9 million more people saving, and up to £10 billion more saved. If, as the hon. Member for Eastbourne (Mr. Waterson) has suggested, more people were saving but no more was being saved, it would not be a successful outcome. We need more to be saved, and we need more people saving. We need outcomes where pensioners are basically better off, which is why we are all involved.
	The Bill makes it clear that PADA is primarily tasked with setting up the scheme. The principles provide the operational framework within which it will carry out that task, and they are fundamental to how it will design the scheme. The hon. Member for Eastbourne has acknowledged in the drafting of new clause 6 that the authority cannot be tasked with achieving each principle in absolute terms. The principles are there to guide it in setting up the scheme.
	The combined effect of the principles and the package of proposals elsewhere in the Bill is to focus personal accounts on the target group I mentioned and to provide safeguards in scheme design that will minimise adverse effects on existing good-quality provision. In setting out those principles, we are asking the authority to consider the effect on future members of the personal accounts scheme, the overall additional burdens on employers and the impact on the broader pension industry, including members and prospective members of qualifying pension schemes.
	We must be realistic. Inevitably, there will be competing priorities, and the authority will need to make judgments about the suite of principles that it needs to deal with to provide the best solution in the circumstances, which is why we have used the phrase "have regard to". For example, the authority will need to evaluate the various options for investment fund choices in the light of members' preferences for fund choices and membership costs. It will need to consider the options carefully, so that the provision of investment choices does not get in the way of our aspirations for a low-cost scheme.
	Clearly, we cannot predict precisely how individuals, employers and industry will respond to the introduction of those reforms. We are seeking to ensure, in so far as it is possible, that we get the best impact out of personal accounts without experiencing the problem of levelling down. It is an important issue, which is why we have always made it clear that personal accounts are being introduced to complement, rather than replace or undermine, other good-quality pension provision. The Bill will introduce an additional pension product.
	This is the core of our ambitions, so the principles require the authority to have regard to encouraging and facilitating participation across the qualifying schemes. When Tim Jones gave evidence to the Pensions Bill Committee, he discussed the gap in the current pensions market, stating that
	"the market correctly recognises that it is a very difficult sector to address because of the very large number of small employers and the costs of approaching it".
	He made clear the authority's role, saying
	"It is our job to address that target market". ——[Official Report, Pensions Public Bill Committee, 15 January 2008; c. 17, Q21 .]
	We are focusing on the target market. However, other individuals who are not quite in the target market, such as the self-employed, may find in particular circumstances that they want to contribute as both an employer and an employee and build up a pension pot and personal accounts. We are happy for the self-employed to do that.
	There is an issue about people who are not employed. At the moment, they would not be able to use personal accounts. We want to see whether we can get a situation where we can prevent levelling down and make sure that we keep the current provisions for employers, so pension schemes continue. There is an element of employer inertia as well as employee inertia—we expect most people who are in pension schemes to stay in them. Employer inertia means that if an employer has got a pension scheme, we expect them by and large to stick to it.
	On workplace personal pensions, amendment No. 29 relates to the treatment of insurance-based products. I want to make it clear that that is an issue for Ministers and Parliament to decide and does not relate to PADA principles. Workplace pensions are an important and growing part of the pensions market. As the hon. Member for Eastbourne has said, membership of workplace personal pension scheme forms around 47 per cent. of current private sector pension membership, which represents around 3.3 million employees involving a total contribution of around £6.7 billion each year. There are 2.1 million members of workplace pension schemes with an employer contribution of 3 per cent. or more.
	We are currently in the process of seeking clarification from the European Commission that from 2012 automatic enrolment into workplace personal pensions is compatible with European consumer protection legislation. We continue to support the Pensions Commission's aim of automatic enrolment across all employers and all workers, and we hope that the work that we are doing with the European Commission will allow us to maintain that position. However, it is difficult to be precise about the timetable for resolving this issue with the European Commission. It is therefore essential that we retain flexibility within the discussions with the Commission. That is why we have a provision in the Bill to enable us to create an exemption, as the hon. Member for Eastbourne has indicated, from the employer duty automatically to enrol employees using workplace personal pension plans. If activated, that exemption would provide employers who meet the prescribed requirements and offer their jobholders membership of a qualifying workplace personal pension with relief from the duty automatically to enrol, providing that they use an enrolment process prescribed in the regulations.
	The issue is difficult, and I am grateful for the way in which the hon. Members for Eastbourne and for Rochdale (Paul Rowen) have approached it—I have briefed them privately on the situation in more detail. I am also grateful for the contributions from a range of stakeholders outside government, including the Association of British Insurers, the National Association of Pension Funds, the CBI and the People's Pensions Coalition—we all share the same aim. There is, as the hon. Member for Eastbourne put it, a plan B, but I would rather stick with plan A and see whether we can deliver it.

Nigel Waterson: I am grateful to the Minister for his summing up, particularly his helpful summary of amendment No. 29, which raises some important issues. On levelling down, I am pleased that he has conceded that the aim is to produce not only more savers, but more savings. We must keep our eyes on the ball, because it would be an utter disaster if we were to end up with the same amount of savings or, even worse, with the Pensions Policy Institute scenario in which fewer savings are redistributed around the system.
	I do not know whether I always talk about budget airlines when I compare the personal accounts system with other pensions—it is, perhaps, the vanilla option. It is important to keep in mind that it is designed to do something for people without any provision at the moment. The Minister said that we cannot prevent levelling down. Technically, that is true, but it is equally true to say that at the moment there is nothing stopping levelling down from happening. The real concern is whether the introduction of personal accounts will encourage levelling down when it is coupled with other issues, such as the Pensions Regulator's consultation on longevity assumptions. One of the PPI scenarios is absolutely disastrous: the one that shows personal accounts reducing the pensions savings pot, which would be an appalling result. It is important to raise that issue, which is one of the twin major concerns behind the Bill in not only our view, but that of many other people.
	The debate has been useful. The issue is ongoing and we will continue to debate it. No doubt the Minister will have more news for us in due course about group personal pensions. In the meantime, I beg to ask leave to withdraw the motion.
	 Motion and clause, by leave, withdrawn.

Paul Rowen: 1 August this year represents the centenary of the introduction of the state pension. I can think of nothing better that this Government could give people than for a Minister to be able to announce, when we go to the TUC national pensioners convention in Newcastle in June, that the Government are restoring the earnings link.
	That would only be a first stage in restoring the value of the pension to where it should be. However one looks at it—I quoted these figures in the debate on the National Insurance Contributions Bill last December—the value of the pension as a percentage of earnings has declined. In 1950 the pension was worth 18.4 per cent. of average earnings; today it is worth 15.9 per cent. When we look around Europe, as the hon. Member for Eastbourne (Mr. Waterson) said, we see that we are the poor relation. Why should we be compared with the likes of Cyprus and Latvia? We consider ourselves to be the fourth largest economy in the world, yet we are unable to give our pensioners a decent state pension. Our state pension is worth only 45 per cent. of pre-retirement earnings compared with 57 per cent. in Germany, 75 per cent. in Poland, and 105 per cent. in the Netherlands.
	It is high time that the Government restored the link and got the value of the pension back to what it should be. I know that the Minister will reiterate, because we hear it whenever we raise this issue, "Well, there's pension credit," but as he knows, 40 per cent. of all eligible pensioners do not claim that. It is also far more expensive to administer. It is much easier to give people what they are entitled to, and have earned, without making them go through what many of them perceive to be a demeaning process of being means-tested to get what they have worked for all their lives.
	We should be doing this. We have had a commitment from the Government, but it is open-ended. We want to set a date. As the hon. Member for Eastbourne said, this provision was agreed in last year's Pensions Bill. The Minister will ask how it is to be paid for. National insurance contributions are in credit at the moment, and there is absolutely no reason why that surplus money cannot be used to restore the link. It can happen now, and I want the Government and the Minister to give a clear indication that it will. If we vote on nothing else tonight, we should divide the House on this new clause to see whether the Government's commitments and promises are more than warm words. I give notice that if neither new clause 7 nor new clause 16 is pressed to a vote, we will want to press our new clause 21, because we believe that the Government have had enough time to deliver on this commitment, and we want to see it implemented now.
	As I said, this would only be the first stage. We want a citizens pension. Instead of setting the bar at which pensioners can have an income at £30 below the poverty line, as is currently the case, that bar should be set at the poverty line. The Government have made a commitment on child poverty. It is a testing target, but in the last two Budgets they came forward with proposals showing that they are delivering. Why can the Minister not deliver on this promise? These people have worked all their lives for us; many of them fought during the second world war to ensure that we could be here now. They deserve that right. It is wrong to say that another 3 million of them are going to die before the promise is kept. It must be kept now, as is appropriate in the state pension's centenary year. The Minister could not deliver a better speech at the TUC national pensioners convention in the constituency of the hon. Member for Newcastle upon Tyne, Central (Jim Cousins) than to say, "We've delivered on our promises."

Jim Cousins: Let me begin by saying that nothing is more glorious to God than a sinner that repents, even if, as in this case, the sinner is a Conservative. If we have achieved consensus on this issue, now is a good moment to put that into effect.
	I pay great tribute to my right hon. Friend the Member for Barrow and Furness (Mr. Hutton), because in many respects the package consisting of this Pensions Bill and the Pensions Bill that preceded it last year is very much his package, implementing the findings of the Turner commission. I have no doubt that he saw the restoration of the earnings link as being a vital part of that package. In his opening statement on these issues, he referred to the long-term damage caused by the eroding effects of our present system of indexation of pensions. The restoration of the earnings link is an absolutely essential component of the credibility of the Government's new pensions proposals in the Bill regarding personal pension accounts. The credibility of personal pension accounts depends on the restoration of the earnings link so that people are assured that they are not paying money into a scheme whose ultimate effect will not be simply to save the Government money, in the form of the benefits that they would otherwise have received.
	Another important part of the package is that by restoring the earnings link we build a bridge between tomorrow's pensioners, who we hope will benefit from the introduction of personal pension accounts, and today's pensioners, who in every other respect do not benefit from the proposals in the Bill. The restoration of the earnings link must not be delayed. It is essential for the delivery of the Government's pension reform package, and it must not be subject to the daily volatilities of the political and economic environment in which we all operate.
	The hon. Member for Eastbourne (Mr. Waterson) mentioned that for the Government the reintroduction of the link to earnings would be subject to affordability and the fiscal position. The current situation is a little different from the one that we were in last year. There is more uncertainty about the fiscal position of the Government, and when we see their accounts at the end of the financial year, we will see, rather remarkably, that they have observed their fiscal rules simply because a large number of people who were entitled to means-tested benefits did not claim them, thus saving the Government money. That is a difficult situation for any Government.
	The point must be made that the longer the restoration of the link with earnings is delayed, the more today's pensioners will end up in relative hardship and depending on the complex rules of pension credit. Indeed, the provision in the previous Pensions Act that pension credit should increase in line with earnings, even when the basic rate of state pension does not, has now become a machine that remorselessly, year by year, draws larger numbers into a state of dependency on means-tested benefits. Once they get there, there is no possibility of retrieving the situation. Parliament should not allow that to continue.
	Of course, we ought to seek simplification of tax and pension credits. We may well have an opportunity to consider some of those issues quite soon, which would be welcome. But in the meantime, we have to protect people from being drawn into dependency on means-tested benefits where that is not necessary. Let us recognise that the people who do not claim the means-tested benefits to which they are entitled are often old people—often women—who live on their own in social isolation. It is entirely wrong that we should not move to protect such people.
	A commitment to link pension credit to earnings, and to set a date for the announcement before the next general election, not after it, is absolutely necessary. That is the purpose of new clause 16, which will also have another benefit. If it is adopted in the launch period leading up to the introduction of personal pensions accounts, when people read about those accounts in the newspaper and the financial sections of the popular press, they will be reassured that they are reading about a valid, reliable, predictable and sound addition to their ultimate savings and income. If we fail to act quickly, many younger people will for years—perhaps for ever—be put off the new pension system we are trying to put in place.
	I welcome the fact that the hon. Member for Eastbourne has decided not to press new clause 7 to a vote, because it would tie the hands of the Government too tightly. It would mean forgoing some of the other benefits in the Bill to which we have not referred this afternoon, such as the introduction of a much longer assessed income period for people who are on pension credit. That provision was in clause 81 of the original Bill—I am afraid I do not know what clause it is in now. I would not want to forgo such provisions, which would be a consequence of the hon. Gentleman's new clause.
	It is the right moment to reconsider this issue. We should reconsider it before the next general election, not after it. Indeed, when the Government originally said that they would consider the issue early in the next Parliament, many people, including myself, assumed that that next Parliament would be rather closer to us than it now seems to be. That is another reason for trying to reconstruct the terms of the debate as my right hon. Friend the Member for Barrow and Furness left it. I offer new clause 16 to the House in the name of myself and my hon. Friends. We have discovered during recent days that as Back-Bench Members of Parliament, we are a very low form of life.

Mike O'Brien: In 1997, we inherited a system that worked against the needy, leaving millions in abject poverty. Many were forced to get by on just £69 a week. There is never enough money to sort out all the problems and ensure that everyone is given the resources that they would wish to have, but this Government have made it a priority to help all pensioners through a number of policies, and in particular, to lift the poorest pensioners out of poverty. We have succeeded in lifting 2 million people out of poverty, and that is a significant achievement of which we can be proud.
	Today, no pensioner need live on less than £124 a week. The figure is £189 for a couple. In 1997, the state pension did not recognise the important contribution of women and carers. In private provision, millions of employees, especially those on low incomes, did not have access to a workplace pension scheme. They were therefore likely to have to rely only on the state pension in retirement. We are tackling some of these issues with a historic series of social reforms which have to be seen as a whole. We have created the Pension Protection Fund and the Pensions Regulator, and made changes so that the state pension provision gives equality to women and carers, and we accept that those will have significant costs to the Exchequer.
	An essential part of those changes is to restore the earnings link. My hon. Friend the Member for Newcastle upon Tyne, Central (Jim Cousins) was absolutely right to say that the provisions in the Bill are dependent for their success on the restoration of that link. The figures that I cited earlier were an understatement. It is actually the case that, unless we restore the link to earnings, we will end up with up to 75 per cent.—not 60 per cent.; I was saying that from memory—on means testing. Restoring the link will reduce the number on means-testing and increase the number who are able to benefit by having the basic state pension as the basis of their retirement income. Those who are on pension credit will be reduced to about 30 per cent. by 2050.
	We are hoping to put together a package which, as result of these changes, will ensure that pensioners have a better deal in the longer term. My hon. Friend is absolutely right to say that the Bill should be seen as a whole and that the restoration of the earnings link is an essential part of the package that will ensure that pensioners get a better deal in the long term.
	If we had continued the policies of the previous Conservative Government and continued to pay people the kind of appalling basic state pensions that they were paying, we would—if this had been only about money—have had £11.5 billion to spend on something else. However, we chose to spend that extra money—in addition to the money already being spent: a total of £76 billion—on pensioners, because we regard them as a priority. I wish that we could suddenly come up with more, but we cannot. What we have to do is manage this process and put in place a series of reforms to secure a better situation in the long term for pensioners in this country.
	We made a legislative commitment in the Pensions Act 2007 to restore the link. We have put beyond doubt our intention to restore it. During the next Parliament, we will re-link the uprating of the basic state pension to average earnings. Our objective, subject to affordability and the fiscal position, is to do that in 2012 or, in any event, by the end of the next Parliament at the latest. That is the bedrock on which our reforms are built, and its introduction is non-negotiable.
	We have always said that, in uncertain economic conditions, we need flexibility around the timing of the introduction of the link, and colleagues will understand the circumstances and conditions that I am talking about today. The Pensions Commission has said that a short delay would not unduly affect the outcomes of the reform package. We need to take the right decisions for pensioners, for taxpayers, for the economy and for the long term. We have to balance all these things.
	My hon. Friend has requested a decision on the earnings uprating in the pre-Budget report, and we have discussed the importance of keeping an eye on affordability and on the fiscal position, and on taking the right decisions for pensioners, for taxpayers, for the economy and for the long term. I understand the keenness to hear the date of the introduction of the earnings link. Let me put beyond doubt our commitment to reinstate the link. That is not just my guarantee; there is a legal obligation, and we will stick to it. [Hon. Members: "When?"] I have already said that it is our objective, subject to affordability and the fiscal position, to do this in 2012 or, in any event, by the end of the next Parliament. That is what Ministers have been saying very clearly, and I have gone further today by making it clear, as a result of the contribution by my hon. Friend the Member for Newcastle upon Tyne, Central, that we see the restoration of the link not just as something that is desirable in itself—because that lot got rid of it, we want to restore it—but as part of a broader package of which it is a foundation stone.

Mike O'Brien: As my hon. Friend is aware, we have made the provision of help for older people a key part of our expenditure. In the recent Budget, announcements on the winter fuel allowance prioritised pensioners because of the circumstances arising from increased fuel costs. The Budget means that next year's winter fuel payments will increase to £250 for households with someone over 60 and £400 for those with someone over 80. That is a significant contribution to older people's winter fuel bills.
	As my hon. Friend will be aware from his own constituents, we have also made it a priority to introduce funding to ensure that older people have free bus passes from 1 April. It is also the case that we have introduced things such as free eyesight tests, free TV licences for the over-75s and we have outlawed age discrimination. We have taken a whole series of steps showing that this Government regard older people and pensioners as a priority—not only in financial terms, but by making changes to how our society operates and dealing with discrimination against older people in the work force. I am working at the moment on another small but symbolic step to ensure that we have an older people's day to show our respect for their role and contribution to our society. All those things are part of our commitment.

John McDonnell: We are still trying to tease out the Government's thinking on why they will not move on this measure. Will the Minister explain—or even give a reference or place information in the Library—the Government's calculations and assessment of the impact of this level of expenditure on the overall economy? What macroeconomic impact would it have if the new clause were accepted? Most of us believe that it would actually have a directly beneficial economic impact not just on individuals but, by increasing demand and thereby expenditure, on the overall economy. At the same time, will the Minister give us some indication of the actuarial calculations of how many existing pensioners will not benefit from any change of policy by 2012 or 2015 because they will no longer be alive?

Mike O'Brien: My apologies, Mr. Deputy Speaker.
	We are putting in place the biggest package of pension reforms undertaken in 100 years. All the measures that we have taken and all the alterations that we are making in state provision relating to, for instance, equality for women and carers, the Pension Protection Fund and the Pensions Regulator constitute a major package of change. A keystone of that package is the restoration of the earnings link. We have made the importance of that clear in legislation: we have taken the unprecedented step of establishing in law that the Chancellor is obliged to do it. We have also specified 2012 as the year in which we seek to do it.
	I accept that there is a caveat relating to affordability. My hon. Friend the Member for Newcastle upon Tyne, Central is aware of the issues that the Chancellor will need to consider. I know from my hon. Friend's background on the Treasury Committee that he has had to examine the detail of those issues, and he knows as well as others that they must be considered in the round. It is easy to be flippant about what could be done if something or other were the case, but the position must be seen as a whole.
	There will be winners and losers—there are ways in which the taxpayer will have to fund the change—and we need to act with a degree of care. However, I repeat the point made by my hon. Friend which I began my speech by endorsing: the restoration of the link is a crucial part of this package. I ask my hon. Friend to let us introduce the package as a whole, because it provides a long-term guarantee that pensioners will be given a better deal, provided not by them but by this Government and what they have done.

Nigel Waterson: We now have a complete change of topic. New clause 12 arises from a good debate we had in Committee about investment principles as they apply to PADA—and to the board and trustees in due course. It seems that everyone is talking about ethical investments to which there seems to be a range of different approaches, of which this new clause is only one. It merely seeks to apply to the authority the
	"United Nations principles for responsible investment ("UN PRI") and adherence to those principles will be part of the contractual arrangements with fund managers in respect of"
	the variety of matters listed.
	The hon. Member for Carmarthen, West and South Pembrokeshire (Nick Ainger) pointed out in Committee that the Co-op ethical fund had had one of the best performances of any all-shares funds in recent times, so it is not as if we are suggesting a measure that is likely to fetter the ability of the personal accounts system to provide a decent return for those saving into it. In fact, in many respects, the opposite is the case. I am delighted that our proposals have received support from a range of different organisations, including FairPensions: The campaign for responsible investment. It makes the point that responsible investment does not necessarily mean disinvesting from so-called unethical industries, but that it does mean taking steps such as to
	"proactively engage with companies on environmental, social and governance (ESG) issues"
	and
	"working with them to future-proof their profits by limiting the potential of...poor governance, lax safety standards or climate change".
	One of the attractions of the UN principles as opposed to other codes that are sometimes cited in this context is that they are not prescriptive but provide what is called a voluntary and aspirational code of best practice.
	FairPensions goes on to say that this House
	"should affirm its commitment to safeguarding investments, and to responsible business practices, by amending"
	the Bill in the way suggested. It says in conclusion:
	"By committing to the UN Principles of Responsible Investment, Parliament will provide a clear mandate to the Personal Accounts Delivery Authority and its fund managers to engage with companies on environmental, social or governance issues."
	The Government's attitude in Committee was very much that they did not want to bind the hands of PADA—or the trustees in due course. I find that surprising, because the question of ethical investment was foreshadowed even in the impact assessment produced alongside the Bill. We are not trying to be prescriptive; we are Conservatives, so we understand the need for business not to be fettered by unnecessary red tape or bureaucracy. However, surely PADA and its successor could reasonably be expected to reflect current best practice—the Pension Protection Fund is already signed up to the UN principles, as are various comparable bodies around the world. The new clause would, however, still leave some flexibility to those running the personal accounts system.
	Two approaches are possible. We know—because that is the way life is—that the default fund will far and away be the biggest fund, as people will not make a conscious decision to invest in a particular type of fund and therefore by default will end up in that default fund. One option is to apply the UN principles right across the board, and particularly to the default fund. Another option would be a specific fund based on those, or comparable, principles. It seemed to be accepted without debate in Committee that there would be a fund—possibly out of only five or six altogether under personal accounts—that would be subject to sharia law. There is a lot of sense in that; it is important that we make that kind of provision. However, why should we not also have a fund based on ethical principles—perhaps Christian principles? Within a limited number of funds—I think the number should be limited for all the practical reasons debated in Committee—there should be that element of choice.
	Following our Committee deliberations, the Minister was good enough to write to Mr. Tim Jones, PADA chief executive—who has featured quite a lot in our debates today—and raise with him the issues discussed in Committee. The Minister shared with us the reply he received on 5 March from Mr. Jones, in which he says
	"I take very seriously the strength of feeling expressed in relation to investments within personal accounts and, in particular, responsible investment."
	He goes on to point out that it is ultimately
	"the responsibility of the trustees"
	and he then says:
	"Consistent with the level of interest and strength of feeling shown by the Committee in this area I intend to address the issue of responsible investment in PADA's public investment consultation which is due to take place later this year and which aims to capture the views of the personal accounts scheme target audience."
	Mr. Jones concludes by saying that he hopes that what he says has "provided...sufficient reassurance". The answer is that it does not. I am delighted that there will be a consultation on this, but I would have thought the appropriate way to proceed would be to consult on the way to deliver these kinds of ethical investment principles in practice under PADA—and the board. All we are asking to do is to put in the legislation the fact that the authority must have regard to the UN principles for responsible investment. That is not an unreasonable thing to require. When personal accounts are up and running, the funds will be a substantial part of investment in this country. That will be the case for the default fund in particular, for reasons that I have mentioned. Therefore, it is important that a message is sent out that the authority will have regard to those ethical investment principles.
	If Ministers take the opposite view, it is odd that, as I have mentioned, the Pension Protection Fund is already signed up to the principles. Why would PADA not be so signed up? It is perfectly legitimate for Mr. Jones and his colleagues to consult on the way in which this matter is delivered—I have given a couple of possibilities—but not on the overwhelming principle. It is perfectly reasonable for this House to say that the principles should apply and to leave the detailed work to the authority.
	Amendments Nos. 25 and 26 approach things from a slightly different angle. By proposing to include the word "needs" and the question of "disproportionate cost", as we tried to do in Committee, the amendments make the point that even where people have their own preferences as to how their money should be invested, both their preferences and their needs should be taken into account. That is because people sometimes make slightly bizarre investment decisions, often for the best possible ethical reasons, when they would be better advised doing something slightly different, or at least spreading the risk in a different way.
	As amendment No. 26 sets out, when it comes to offering choice we must address a real issue about disproportionate cost. If any message came across loud and clear from the evidence of Mr. Myners and Mr. Jones to the Committee, it was their obsession with keeping things as simple as possible for personal accounts in order to try to drive down those running costs and administrative costs as far as possible, so that the accounts can deliver a reasonably cheap, easily accessible and easily understood form of investment for retirement. We are not looking at anything remotely like the Swedish model, which I believe has about 200 to 300 different funds, and I commend new clause 12, and amendments Nos. 25 and 26, to the House. If the Liberal Democrats do not take offence, I shall not deal with their amendment No. 39, as I am sure they will do it justice.

Mike O'Brien: I hear the points made by both Opposition spokesmen. It is important that we give full and fair consideration to the UN principles, and that is why I wrote to the chief executive of PADA to ensure that the board did so. I received a positive response. Tim Jones, the chief executive, confirmed that the issue of responsible investment will be explicitly addressed in the investment consultation that the authority will undertake later this year. I am not sure why Opposition Members do not want the consultation to take place before that happens. It would be a better way to approach the issue.
	We want to have a discussion on the UN principles, and what better way than to create a consultation process in which the broad principles of the pension fund proposal and the creation of personal accounts can be discussed openly and fully? The UN principles could then be the focus of that debate. That would be a positive response.
	I am especially interested in the views of the hon. Member for Eastbourne (Mr. Waterson) on this matter. One of the key issues that we have considered on personal accounts is the need to ensure that they complement rather than compete with current provision. We also want to ensure that personal accounts do not have advantages over and above other schemes, which is one reason why I was sceptical about some of the proposals made in relation to pay-as-you-save.
	However, nor do we want to create a situation in which there are disadvantages. Would the application of the UN principles be a disadvantage? It would be interesting to find out whether the Conservatives regard them as an advantage in some way. If the principles would oblige this particular pension scheme to apply the principles, would they oblige all other pension schemes to comply with them? We have taken the view that the principles are very worth while, but it should be a matter for the trustees to consider, for each individual pension scheme, whether they wish to apply them.
	The Conservatives seem to be suggesting that we should oblige a particular pension scheme to take on those principles—in fact that we should oblige not only the pension scheme to take them on, but PADA, which is a delivery authority that does not run a pension scheme but merely sets one up. I am perplexed about what the Conservative party's policy now is. If we are to oblige this particular pension scheme to have this provision, why not all public sector pension schemes—why not all private sector pension schemes? Is that now Conservative party policy? I would be interested to know.
	My view remains that which we set out in Committee. The principles are good and valuable, and we want to see pension schemes take account of them when the trustees regard that as appropriate. We will not force pension scheme trustees to adopt them. We are happy to say to those who are setting up personal account schemes that they should consider the principles. Indeed, we have had a positive response from people who have said that they will consult on the inclusion of the principles in their pension schemes.
	We have played a positive role in promoting that approach. We have always held the view that the trustee should decide the principles on which a scheme operates and invests. That has always been part of our law. There are some constraints on trustees, but we have essentially said that the interests of the members are best protected by giving obligations to the trustee, which they have to enforce, that are limited to ensuring that the trustee looks after the best interests of the members.
	It now seems that some people are suggesting that we must go further—not with the consent of the trustees, but otherwise. We need to be a little cautious before we do that. As a result of the Committee debates, I contacted Tim Jones, the chief executive. We have had his response and we need to recognise that we have created PADA in order to ensure that it consults properly with the public in the setting up of one of the biggest pension schemes, if not the biggest, ever created in this country. The aim is that there should be widespread public consultation for the precise reason why up to 9 million people, many of whom are not currently saving, will be signing up to the scheme. If the scheme is to be treated in an entirely different way from any other scheme so that the trustees cannot make decisions about what investment principles they will operate under, that is quite a significant step.
	In a sense, I am with the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) in saying that the principles are good and that I hope that in due course the trustees will have regard to them. I can see that argument. We would not have written to the chief executive of PADA if we had not taken the view that it was important that that should be so.
	There is a need for the trustees' independence and expertise in making such decisions to be recognised, too. That is the basis on which pensions have been protected in this country for a long time, and I do not think that we should tamper with it for the purpose of making a change that is, at best, symbolic, given that we already have a clear concession from the chief executive that the matter will be consulted on.
	New clause 12 and amendment No. 39 presume that socially responsible investment approaches would be in the best interests of members. However, signing up to the UN principles would require active management of funds, which is more expensive than passive management of funds. It must be for the trustee to decide whether the additional costs are in the members' best interests. Otherwise, we will effectively be telling the trustees that they must manage their funds in a particular way and ensure that the principles that the UN has put forward are complied with. Let us be clear about this: we will be saying that if there is any extra cost in doing so, it will fall upon the people who contribute to the pension scheme.
	After consultation with members of the public, the trustees may decide that they want to do that. Many of us in the House might well say that that is a laudable thing for them to decide, providing that they have consulted with the scheme's members, and providing that if PADA has taken a view that it is advisable for the principles to be had regard to, it has itself consulted stakeholders and the public in setting up the scheme.
	We are being asked to ignore all that and take a step that we have not taken elsewhere. We are being asked to take a step that goes well beyond and has potential cost implications for some of the poorest contributors that there are likely to be to pension schemes. I do not know whether either Opposition Front-Bench team has made an assessment of the potential costs for such low-paid people. I suspect that they have not, and that they are prepared to impose additional costs on members and potential members of the personal accounts scheme without even considering the implications and without talking to them or consulting them. They should proceed with a great deal of care.
	It would be wrong to argue that the scheme should be used to set an example to other companies or pension schemes, as suggested by some Members in Committee. The scheme's only purpose is to represent the best interests of its members within the existing legal framework. It is not the right instrument to express Parliament's general views on investment. We are creating a pension scheme for low and moderate income people. We may have all sorts of views about what we see as a desirable investment policy, but do we really want to impose those views on people on low incomes, whereas we are not imposing them on people in other pension schemes who are much more able to afford to pay for the principles?

Michael Penning: I have been in my place since prayers to ask this question, so I hope that the Secretary of State will bear with me if I press him again. I asked whether my constituents and other FAS members would be taxed on the lump sum. The Secretary of State alluded to the fact that the matter had been addressed at oral questions. Since then, however, we have discovered that some are going to be taxed on the lump sum because it is coming through in the form of a lump sum, and because they had to work to keep going during the five-year wait for compensation. Will the Secretary of State confirm that my constituents will not be taxed on the lump sum for which they have waited for five years, and which is the pension that they were entitled to in the first place?

James Purnell: I believe that we have addressed that issue: those people will be taxed in exactly the same way as if the situation had not occurred and they had been paid regularly—but we shall be happy to write to the hon. Gentleman to set that out .
	Tonight's changes address the two key problems—that only a minority had access to a private pension, and that even those were unaffordable, so radical reforms were needed. In addition to paying tribute to the Pensions Commission, we should pay tribute to the stakeholders who have carried the Bill all the way through, and have been prepared to make trade-offs to ensure that that happens. The consumer representatives and the unions have accepted that the state pension age will be higher; the employers and the Association of British Insurers have accepted that there will be compulsory contributions from employers and the new low-cost personal accounts scheme. Because people have been prepared to make those trade-offs, the consensus has been solid throughout the Bill's passage. It means that, tonight, the combination of giving everyone access to personal accounts or to a private pension, combined with automatic involvement, will enable us to turn on its head the inertia that currently stops so many people from saving.
	In conclusion—we have little time, and I want to ensure that everyone who wants to speak can do so—we need to keep the word "consensus" at the forefront of our minds. Consensus is important not just as a political device, but in order to help people to save. If people are thinking about putting money away for 20, 30 or 40 years, they will be more likely to do it if they are confident that there is a consensus between political parties, which will ensure stability in the framework.
	In thinking about that, it is interesting to look back to a previous debate on the Social Security Pensions Bill 1975, which I read about this afternoon. I do not think that the hon. Member for Eastbourne had much to do with that particular Bill, although I am sure he will know how Barbara Castle felt when she said in opening her speech that it was the third time in just over five years that the Secretary of State for Health and Social Security, as she was then, had brought a pensions Bill before the House. If she is looking down on the hon. Member for Eastbourne now, I am sure that she will feel much sympathy for him.
	The interesting thing about that debate is that Barbara Castle said very clearly that she wanted to build her reforms on the basis of consensus. She said that she intended them to command general acceptance, and hoped they had succeeded in that regard. Later the Conservative spokesman—Lord Fowler, as he is now—said that his party believed consensus was possible. I think that on Third Reading there was no Division. Both sides hoped that the Bill would command a consensus that would continue, yet within years that consensus had fallen apart.
	The key thing that we should tell ourselves tonight is that by legislating we are not completing the reforms, but merely establishing the start of the process. If we believe, as I think Members in all parts of the House believe, that this is an important reform which is in the interests of millions of people—particularly low and moderate earners—I think we should say tonight that we are not satisfied for the consensus to be merely legislative, and that we will work together over the next few years to ensure that the hopes we have for the Bill will be realised in practice. We need to continue to make trade-offs, and to work together to improve the chance of millions of people to have decent incomes in retirement.

Chris Grayling: I echo the thanks and congratulations that have been extended to all who have been involved in the Bill's passage. I congratulate the Minister of State, for it is always a challenging task to steer these measures through; my hon. Friend the Member for Eastbourne (Mr. Waterson), who is a seasoned performer, but no less effective as a result of the number of occasions on which he has dealt with pensions matters from the Dispatch Box; the hon. Member for Rochdale (Paul Rowen); and all those who served on the Committee, who have dealt with the detail of the debate in a good and constructive manner.
	We have just heard the Secretary of State describe the Government's reform plans in glowing terms, but it is important for us to remember that we have been here before. Tonight I have been reading the report of a debate on the introduction of stakeholder pensions which took place in the House in 1999, led by the then Secretary of State, who is now the Chancellor of the Exchequer. The Government said that 4 million to 5 million people would benefit from stakeholder pensions, and described them as an appropriate vehicle for people on low earnings which had been almost universally welcomed. So we are not exactly at first base when it comes to major pension reforms, and this time it is important for us to get it right.
	We are not without reservations about the detail of the Bill, and we feel that work remains to be done on the reforms, although it is true that few Bills generate such a general desire for them to succeed. We want this Bill to succeed, because it is in the interests of the nation to have a pensions system that works, but, as I have said, we have been here before. On 11 May 1999, the present Chancellor of the Exchequer said
	"I am confident that, by the end of this Parliament, pension provision and structure will be set on a firm footing that will serve this country well for generations to come."
	That did not actually happen. Now, the second time around, it really does need to work. Like the Secretary of State's favourite football team, the Bill demonstrates plenty of promise, but in the end, lacks the depth to deliver the results. We have had widespread discussions with different stakeholder groups, and, as the right hon. Gentleman said, the Government have received plenty of helpful advice from within the House and elsewhere. However, there has been little change in the detail, and little in the way of actual response to the concerns that have been raised.
	Means-testing has been a big issue—and again, we have been here before. In 1999, the present Chancellor of the Exchequer said:
	"The Government are aware that, because of the present capital and income rules, many pensioners who have modest savings or a modest income stream are adversely affected by the benefits system. We said in the Green Paper that we are determined to tackle that".—[ Official Report, 11 May 1999; Vol. 331, c. 132.]
	Here we are, nine years later, discussing the same issues—in this of all weeks, when the Government are having problems in dealing with the issue of financial support for people on low incomes.
	We have argued throughout that the issue of means-testing is potentially fatal to these reforms. I am grateful to the Secretary of State's predecessor, the Minister of State, for initiating the debate on the subject, but I have to say that we expected more by now. We set out specific issues to be processed in Pensim2, but we have not yet received a detailed response. We have seen no detailed information about the sensitivities surrounding take-up if the means-testing issue is not addressed, but we have had private warnings from some of the groups involved that Ministers are not taking the issue as seriously as they expected. It is extremely important for this review to be more than just a way of postponing bad news until a later date. It must not be a case of "What happens now?" We need a detailed document in the autumn, a debate in this House and an open and grown-up discussion about what can be done and when, and we need to accept that the cost of getting this right might not exceed the cost of getting it wrong; the cost of not getting this right in years to come might be a much bigger bill for the taxpayer and a much lower take-up of personal accounts, and it might undermine the reforms.
	We are equally disappointed that the Government have not yet fully addressed other key issues, such as auto-enrolment into GPPs. We do not want that. We have heard in the debate about the dilution of existing provision. It is extremely important to preserve existing provision—the must Bill add to, rather than undermine, what is already there. As the Bill leaves this House, Ministers still have little answer to some of these basic questions. It is extremely important that they be addressed. I hope that they will be addressed as the Bill progresses through the other place, and that their lordships will have the opportunity to put these questions time and again, and if necessary to change the Bill to ensure that they are answered.
	We have other key questions relating to the cost of the scheme. It will not work if the costs are too high. We talked earlier about rumours in circulation about what the costs are; it is extremely important that Ministers lay those to rest.
	It is also important for us to hear more from the Government over the next few weeks about what they will do to address the concerns of small employers in particular. Ministers will be aware that a number of pressure groups are asking for more information about what the Government intend to do, and it is important that we hear from them about that.
	I have said that we want to get things right—indeed, I said on Second Reading that we want this to work properly—and that is why we have attempted to engage in constructive debate. We want to get things right not least because there is now a good chance that it will fall to us to implement the reforms. Given Labour's trials and tribulations, it appears ever more likely that that will be the case. Indeed, the Secretary of State is already positioning himself to become the next Leader of the Opposition. The Conservatives are making sure that we are ready to take over Government, should the circumstance arise in 2010. We are still not convinced that the Government have got everything about these reforms right. If they do not address the issues as the Bill continues its progress through Parliament, we are ready and prepared to make the necessary changes in 2010 after the next election, in order to ensure that when the reforms come through in 2012 they deliver a system that really will, as the Chancellor said nine years ago, last a generation and do us proud for the future.

Paul Rowen: I join with the Secretary of State in thanking the Minister for Pensions Reform; I thank him for the courteous way in which he has dealt with our inquiries, and for writing to us on certain issues that we have raised. I also thank the hon. Member for Eastbourne (Mr. Waterson) for his comments—he is on his fourth Pensions Bill; it is my first, and we shall have to wait and see whether it is my last—and all the other Committee members and Committee staff.
	As the Secretary of State said, this is the final part of the implementation of the recommendations of the Turner report. Therefore, it is important to look at the two sets of measures together. This is a complicated Bill; there is a lot in it, and there is a lot of work still to do. As an Opposition, we have tried from the start to maintain the consensus, but to raise issues where we feel that there is a need for more information, more work or greater transparency.
	As the Minister for Pensions Reform knows, we still have several concerns and want work to be done on certain areas. Mention has been made of means-testing; I referred earlier to the Government's difficulties with the 10p tax rate, and we do not want that to be repeated in terms of means-testing. This is a groundbreaking reform that will ensure that many low and middle-income people save properly for their pension. It would be tragic if they were to get their pension and then lose it because the benefits system was not flexible enough. Again, we wait to see what the outcome of the review will be, and we hope that the Government will address this matter. I know that my colleagues in the other place will also be looking at this, and will perhaps be subjecting the matter to further scrutiny.
	We have raised the issue of generic advice and our concerns about the level of it. The Thoresen review has dealt with some of those matters, but we nevertheless again give notice that we have issues and concerns. We are disappointed that the Minister is only now having a consultation about the open-market option, because we share the view of much of the pensions industry that that should, and could, by now be in the Bill, and that it would have been a useful tool that could have benefited many people.
	We are disappointed with the fact that although the Minister can filibuster about the United Nations ethical principles, the Government have done little to implement them. This is not just for readers of  The  Guardian; this is about ensuring that investing ethically benefits pensioners as well as those who receive the investment. Nevertheless, the Bill is important and will benefit many people. If it ensures that pensioners have a decent income, that is to be welcomed.
	Finally, I am disappointed that the Government have failed, in the centenary of the introduction of the old age pension, to say categorically that they will reintroduce, from next year or whenever, the link with earnings. The hon. Member for Epsom and Ewell (Chris Grayling) quoted the Chancellor's statement that many pensioners who are entitled to pension credits do not claim them. We want pensioners to have a guaranteed income, and all the issues about means-testing would be much better for that. Nevertheless, I welcome the Bill, which is a step in the right direction. I look forward to my noble Friends in the other place tabling amendments that we can perhaps consider on another date.

Michael Penning: It is an adage that if you sit here long enough, you will get your time. I am about to get more time than the Front-Bench spokespeople, which is fantastic news. As I mentioned, I came in for Prayers this morning. I have sat here throughout not only because this is a very important debate, but because the financial assistance scheme was not covered on Report and so I could not talk about it much then—I now have ample opportunity to do so.
	I have made many speeches in this House before this Secretary of State and Minister of State—the Minister for Pensions Reform—as well as before previous Ministers of State, calling for justice for the 125,000 pensioners whose pensions were stolen from them when their occupational schemes were wound up. I shall repeat again that more than 700 such people come from my constituency. I was ever so pleased when, after five years of campaigning by many hon. Members across this House, we thought we had reached the conclusion and we thought that those people would receive their compensation. We all fought for 90 per cent., and that is what they will get through the financial assistance scheme.
	I told my pensioners at our public meeting in my constituency on the Saturday when many members of the team who have been working with the Government Front-Bench team on the issue were present—people such as Peter and Jacquie Humphrey, Dave Allen and Ros Altmann—that we must examine the small print. I am worried not by the Front-Bench team who are present, but by their paymasters in the Treasury, who have always worried me and who have frankly been holding this back for many years.
	I am pleased that the Secretary of State has promised to write to me about the two points I raised in my intervention. Perhaps he would be kind enough to write to me about a couple of others, too. The first relates to pensioners who should have been getting their pension but who had to receive benefits because the FAS has not paid out. Will the Government guarantee—will the Secretary of State guarantee this to me in writing, if necessary—that benefits paid to pensioners in schemes while they have been waiting will not be claimed back? It seems obvious that they would not be, but successive Governments have often claimed back moneys paid in benefits when people have received compensation. That often happens in respect of injury compensation where people have been on income support.  [Interruption.] I am sorry that Members on the Government Front Bench are not willing to listen to a debate in which some of us have participated for seven hours, but if they could bear with us for a few more minutes, they would then be able to go off to the bar and have a laugh. This is a serious matter. Many people are worried about whether they will have to pay back the benefits. There is a track record of that happening, and I seek assurances from the Government that that will not happen to these pensioners.
	The other issue—I am grateful that the Secretary of State agreed to meet with me about it—is the situation of those who have lost their loved ones while waiting for the compensation to come through. My constituent Dave Cheshire died about two and half years ago and his widow, Marlene Cheshire, does not know what will happen. If the claimants had still been alive, they would receive the full compensation package, but their widows may be in a difficult situation. When the Secretary of State was the Minister of State, he met a delegation of widows from all over the country and he promised to look at the situation then, but it is still a big issue now and of grave concern.
	The other, linked issue is that of claimants who have lost their income while they have been waiting for compensation because they have been unable to work due to sickness. I wrote to the Secretary of State about that recently, because some of my constituents are worried about how much money they will get from the scheme. They want to know whether they can enter the scheme early because they are disabled. It is a technical point, but it is important. If they are not available for work because they are disabled, can they enter the scheme early or do they have to wait for the full version?
	I apologise for bringing those points up at such a late stage, but they are vitally important for the pensioners who are likely to get money from the FAS. They need to know the details so that they can plan their future.
	All of the great work that has been done on the Bill and the consensus that the Government have reached with the Conservatives and the Liberal Democrats is important, but it will be a waste of time unless the public have trust in pensions. The Secretary of State mentioned 12 million people who could join the scheme, but they will not go anywhere near it if they do not have any trust in it. I have been canvassing in the London elections and it is an issue on the doorstep. People are concerned about their futures and whether they can trust anybody with their pension schemes, especially with the banks and the current credit squeeze.
	Many people who lost trust in traditional pension schemes, especially when the occupational schemes started to be wound up, looked to investment in property. A crisis is happening there, alongside the crisis of confidence in the pension scheme. In the eloquent words of Ros Altmann, who was a Government adviser before she helped the occupational pension scheme groups, we have a pension crisis today that could well become a pensioner crisis tomorrow, unless we address the issue of confidence in the pension system.
	It is up to the Government to be the driving force. They have been the driving force on this issue, but—as Conservative Front Benchers have said today—we have heard it all before from both Labour and Conservative Governments. They have claimed that whatever they are proposing is the panacea to the pension problem and will mean that more people will have a decent pension. However, even if this scheme works, we will not solve the problem unless we address the issue of means testing.
	Earlier on, we heard of the millions of people whom the actuaries assumed would not take up the means-tested benefits. The Minister of State said that he had written numerous times to those who had been pinpointed as the sort of people who should be getting pension credit. After writing a third or fourth time, the Government should take the hint: those people will never apply for pension credit. They see it as a handout and as taboo, and they would be ashamed to claim it. There is no other reason why they should fail to claim it, if the Government have written to them— [ Interruption. ] Ministers are googling away on the Government Front Bench, but if they had listened to the debate they would have heard about the thousands of pensioners who do not take up the pension credit because they see it as a stigma to do so. It is not because of the complicated forms; that is a certain area. It is not because they have not been informed enough; that is a certain area. There are whole areas of this country where pensioners will not take up the credit because they feel that they are going cap in hand. We should have a link to earnings, which should come forward now. If that happened, a lot more people would not be on means-tested benefit, and the savings would be coming across. All through the debate, from both sides of the House, including the Secretary of State's Back Benchers—

Ann Coffey: I welcome the new Children and Young Persons Bill, which aims to reform the statutory framework for the care system and to ensure that children and young people receive high quality care and support. The Bill also aims to improve the outcomes for children in care compared with those of their peers and to improve placement stability. I want to focus tonight on a crucial tool for helping to improve outcomes for children in care and the quality of inspections of children's homes. I have felt strongly about the importance of robust inspection for many years, ever since I was a social worker in the 1980s. In 1984, I introduced a ten-minute Bill to ensure that children's homes of fewer than four children were properly registered, which they were not in those days.
	There are about 6,500 children in children's homes and hostels in England, which is 11 per cent. of the total number of children. The latest data show that those children tend to be older—14 per cent. are aged 10 to 15 years and 23 per cent. are 16 and over. Many of them have complex needs and display challenging behaviour. If we are to improve outcomes for them, it is all the more important that we have high quality care. We need rigorous inspections of children's homes so that poorly run homes can be made to improve or close. It is only with a good care environment that young people will achieve better educational outcomes. Without the support of their corporate parents, that will not be possible. That means not only the social worker but the care home.
	I welcome the measures in the Children and Young Persons Bill to enable registration authorities to issue compliance notices to children's home providers who are failing to meet required standards, and to impose a notice preventing new admissions to an establishment where they are deemed inappropriate. That will make it easier to enforce minimum standards. In order to get to the stage of taking action against homes, however, we need more rigorous inspection regimes to be introduced. We have to ensure that children's homes provide the standards of care necessary to improve outcomes for the children looked after.
	All children's homes are required to be registered under the Care Standards Act 2000. Ofsted is now responsible for the inspection of children's homes, having taken over the role from the Commission for Social Care Inspection in April 2007. Children's homes are subject to detailed statutory regulations and national minimum standards. The framework for inspection reports is the five outcomes in Every Child Matters, which formed the basis of the Children Act 2004. The five outcomes by which children's homes are inspected are being healthy, staying safe, enjoying and achieving, making a contribution and achieving economic well-being. I believe that particularly in relation to children's welfare and running away, some of the minimum care standards and how they translate to the five Every Child Matters outcomes are too general. That can lead to inspection reports that do not show the forensic detail that is needed.
	I became interested in inspections after I was recently alerted by my local community safety team in Stockport to concerns that it had about what it saw as the inadequacies of Ofsted inspection reports on some children's homes in my constituency. The team had catalogued numerous instances of problems involving children at the homes, and felt that the inspection reports did not reflect the true picture of what was actually going on there. The team provided me with evidence of large numbers of children running away, going missing, repeat offending and committing assaults and criminal damage, which was not reflected in the reports under any of the general inspection headings. That antisocial behaviour was causing problems for local residents living near the homes, and the team was worried that if the incidents were not being highlighted, other agencies could not provide the interventions needed to help the young people involved to correct their behaviour.
	Stockport has a very high number of children and young people placed in our children's homes from other local authority areas. Indeed, 53 per cent. of all looked-after children in Stockport are from out of the borough, compared with a national average of 35 per cent. Many of the young people who were causing problems and had attracted the attention of the community safety team had been exported into Stockport from outside the borough. I am pleased that the new Children and Young Persons Bill addresses that problem and is intended to limit out-of-authority placements.
	I decided to apply for reports of 10 children's homes in Stockport from Ofsted, to check for myself the quality of inspections. The first problem that I encountered was getting hold of a copy of the reports, which were not available on the Ofsted website. I applied for them and received a letter saying that my request was being dealt with under the Freedom of Information Act 2000. I objected, and of course I was immediately supplied with the reports, but my point is that they are not easily accessible.
	As I have said, I had detailed statistics about the many incidents of children going missing and about assaults and criminal damage in and around those homes, committed by the residents, yet those statistics were not reflected in the reports. Even without that important information, four of the homes were officially classed as "inadequate", three as "satisfactory" and only three as "good". My point is that the reports contained no context or overview about how often children were getting into trouble or going missing. Without that, we cannot truly assess whether the care provided by the homes helps to manage or stabilise the behaviour of young people, or whether the homes are meeting the standards for safeguarding children under the Every Child Matters criteria. It cannot be right, for example, that the inspection report into one Stockport home failed to mention that one young person had run away 89 times. Another report did not mention that there had been 69 cases of residents going missing, six assaults and 31 incidents of criminal damage nearby.
	Under the regulations, the home should promote and make proper provision for the welfare of children, as well as for the care, education and supervision and, where appropriate, the treatment of children accommodated there. The national minimum standards call for written records of all incidents of absconding and the reasons given by the child for running away. However, there is no requirement for those incidents to be included in the inspection reports and so they are not being reflected under the staying safe criterion. I think that they should be.
	I am particularly concerned that three of the homes in Stockport—all managed by the same organisation—were given notice to improve last year and were classed as "inadequate". Since then, two of those three homes have been inspected again and have now been classed as "satisfactory". However, it is not clear to me what level of improvements have been made to warrant moving from a rating of "inadequate" to "satisfactory". Again, the problem is that the inspection categories are too general.
	Another children's home in Stockport, which has a different owner and charges up to £4,250 a week per child, has sent out advertising flyers trying to attract placements for prolific and priority offenders from areas outside Stockport. The flyers say:
	"Our aim is to drastically reduce offending behaviour and achieve positive outcomes for the most challenging young people".
	However, the community safety team has given me detailed times and dates of incidents involving two clients that reveal that the home is failing dramatically in this stated aim.
	In the case of one young person, who was already electronically tagged, there were more than 35 incidents over nine months. The incidents ranged from assault, burglary, missing from home, criminal damage, punching and biting care workers, throwing a knife at another resident and stealing a vehicle. The other young person had 15 similar incidents. The relevant Ofsted inspection report did not reflect any of the above cited behaviour.
	After reading the reports on the 10 children's homes in Stockport, I wrote to Ofsted to express my concerns about the lack of thoroughness of the inspection reports. Since then, I have had a very helpful meeting with Michael Hart, Ofsted's children's director, and Andrew Mercer, an assistant divisional manager in the children's directorate. They assured me they had taken on board my concerns and would feed them into the on-going review of national minimum standards for children's homes.
	I am also grateful to the Minister for allowing me the opportunity to raise some of those concerns at a recent meeting. I want, through this debate, to put my concerns on the record, together with what I hope will be his positive response to them.
	I believe that a number of steps can be taken to improve inspections. The first point that I raised was the importance of the reports being made more freely available. I would like to see them published as a matter of course on the Ofsted website, and I understand that Ofsted is now consulting on that. At the moment, the inspection reports only go as a matter of course to the owner of the home, whether local authority or private. I believe that they should go as a matter of course to the placing authority, to the authority in which the home operates, and also to the schools and agencies responsible for tackling crime and disorder in the area. If a home is deemed to be inadequate, the placing authority should put its reasons for continuing the placements on the child's record.
	I would also like statistics to be published that show the number of homes and their inspection categories, so that we can see the impact of inspections in improving standards—just as happens with the school league tables. If local agencies have a responsibility for dealing with the behaviour and education of all looked-after children in their area, they should also be aware of the quality of care being provided.
	I want the reports to be better informed, with inspectors seeking the views of local agencies such as crime reduction partnerships, community safety teams and schools in advance of their visits. I accept the usefulness of random visits but I also feel that, if the police and schools were consulted on their views about the homes and the activities of residents before the visits, the reports would be better informed and consequently more useful. Also, it would encourage homes to work more co-operatively with local agencies if they knew that those agencies would be asked for their views in inspection reports.
	Does the Minister agree that as part of the inspection process, it would be a good idea to invite comments from local crime reduction partnerships, community safety teams and other agencies about antisocial behaviour, offending and running away by young people in such homes to help inform the inspection reports? Does he also agree that it would be useful if schools were consulted about the level of support that care homes provide to pupils, the amount of communication between teachers and care home staff, and the performance of pupils in care?
	I suggest that the national minimum care standards be updated so that inspection reports contain a summary and proper evaluation of all incidents of running away, assaults and criminal damage. That would enable placing authorities better to evaluate the control mechanisms in place in the home, so that they can manage behaviour and assess whether the home properly met the staying safe criterion.
	I pay tribute to my hon. Friend the Member for Warrington, North (Helen Jones) for all her hard work on the all-party group on runaway and missing children. As secretary of that group, I know that many of the 100,000 children who go missing every year come to some harm. One in six is forced to sleep rough or with strangers, and one in 12 is harmed. I would therefore argue that incidents in which children go missing from children's homes should be recorded under the staying safe criterion of the inspection reports. I know that when some children go missing, they are just staying out late at a friend's house, but for others the result is more serious. We must find a way of assessing the seriousness of "missing" incidents and why they happened.
	I am concerned that, owing to the way in which inspection reports are structured, they are not effective tools for achieving minimum standards or improving standards. If we are to improve outcomes for looked-after children, we must not only enforce minimum standards but use inspection reports to drive up standards. Ofsted inspections have been a vital tool in doing that in our schools, but if care standards are to be effective in improving standards in our children's homes, they need to be more prescriptive in what is taken into account in the inspection, need to include other agencies' observations, and must be widely published and available.